LATAMThin moat

Netflix (NFLX) — moat facet

In Latin America Netflix raises prices faster than inflation and can still lose revenue in dollars, as Argentina showed in 2024.

Latin America is Netflix's third line and its most volatile. LATAM streaming revenue was $5,357.5 million in 20251, 11.9% of the total2, and $1,584 million in the second quarter of 20263, the fastest-growing region that quarter.

LATAM streaming revenue ($M)4,07020224,44620234,84020245,3582025Netflix Forms 10-K FY2024 and FY2025; 2025 +11% reported, +23% constant currency
Half the growth lost to currency in 2025.

Inside the line are 53.3 million memberships at the end of 20244, paying an average of $8.24 a month in 20245, down from $8.48 in 20226.

The history is shaped by currency. Revenue rose from $4,070 million in 2022 to $4,446.5 million, $4,840 million and $5,357.5 million78, much slower than local prices. In 2024 currency movements reduced Netflix's revenue by about $1,424 million, "primarily driven by the devaluation of the Argentine peso"9, and LATAM revenue per membership in constant currency rose 21% that year10.

How it is paid: fees in local currencies, raised often to keep pace with inflation. In 2025 LATAM grew 11% reported and 23% at constant currency11; in the second quarter of 2026, 21% reported and 16% at constant currency12, a year in which currency helped rather than hurt.

Profitability is not disclosed by region13. The region also carries a specific tax cost: Netflix recorded about $619 million for Brazilian non-income tax assessments in 202514 and paid $729 million in the first half of 202615.

Latin America is also where Netflix's smallest workforce sits: about 700 employees, 4% of the total16, against 12% of revenue. The region's revenue per membership in constant currency rose 21% in 2024 on Argentine price increases17, the fastest price growth of any region, yet the dollar figure fell. For shareholders the region's value depends as much on exchange rates as on members, which is why reported growth swung from 11% in 2025 to 21% in the second quarter of 20261819.

Brazil is also where Netflix's biggest recent one-off cost arose. The company expected about $700 million of deposits related to the Brazilian tax matter in 202620, on top of the charge already taken. Set against LATAM's $5,357.5 million of revenue in 202521, the Brazilian cost is a reminder that the region's profits, which Netflix does not disclose, carry country risks the revenue line does not show.

The outlook is member growth with volatile dollar results. The verdict would change if the gap between constant-currency and reported growth widened again, as in 2024, because then local price rises would be worth little to shareholders.

Moat trajectory: Holding steady

Q2 2026 +21% reported after +11% in 2025.

The number that tests this moat
Reported
LATAM streaming revenue growth, latest quarter
+21% reported, +16% constant currency (Q2 2026)

Dollar growth against local growth; a return to a wide gap would make price rises worth little.

Source: Netflix Q2 2026 shareholder letter ↗
References
  1. ReportedLATAM streaming revenue was $5,357.5 million in 2025, 11.9% of the total, and $1,584 million in the second quarter of 2026, the fastest-growing region that quarter.
    Netflix Form 10-K for fiscal 2025 - Item 7 MD&A: streaming revenue by region. — FY2025 · publ. 23 January 2026 · source ↗
  2. Moat Explorer calcLATAM streaming revenue was $5,357.5 million in 2025, 11.9% of the total, and $1,584 million in the second quarter of 2026, the fastest-growing region that quarter.
    Moat Explorer calculation from Netflix's reported financial statements, shareholder letters and market data ($ millions unless stated). Content amortization / revenue: 14,026.1 / 31,615.6 = 44.4% (2022); 14,197.4 / 33,723.3 = 42.1% (2023); 15,301.5 / 39,001.0 = 39.2% (2024); 16,422.2 / 45,183.0 = 36.3% (2025); Q2 2026 4,311.3 / 12,559.9 = 34.3%. Revenue growth 2022-2025: 45,183.0 / 31,615.6 - 1 = 43%; 2025 45,183.0 / 39,001.0 - 1 = 15.9%. Operating income 13,326.6 / 5,632.8 = 2.4 times. Gross margin (45,183.0 - 23,275.3) / 45,183.0 = 48.5% (2025); (33,723.3 - 19,715.4) / 33,723.3 = 41.5% (2023). Q3 2025 operating margin excluding the Brazil charge (3,248 + 619) / 11,510 = 33.6%. Additions to content assets Q2 2026 4,927.5 / 3,835.8 - 1 = 28%. Cash content spend = additions less change in content liabilities: 16,839.0 - 179.3 = 16,659.7 (2022), 12,554.7 + 585.6 = 13,140.3 (2023), 16,223.6 + 779.1 = 17,002.8 (2024), 17,096.6 + 610.8 = 17,707.5 (2025); ratio to amortization 16,659.7 / 14,026.1 = 1.19, 13,140.3 / 14,197.4 = 0.93, 17,002.8 / 15,301.5 = 1.11, 17,707.5 / 16,422.2 = 1.08. Licensed share of amortization 8,713.6 / 16,422.2 = 53%; licensed growth 8,713.6 / 7,689.0 - 1 = 13.3%; produced growth 7,708.6 / 7,612.5 - 1 = 1.3%. Produced share of content assets 20,639.8 / 32,778.4 = 63%; content assets / amortization 32,778.4 / 16,422.2 = 2.0 years. Tax incentives / produced amortization 1,000 / 7,708.6 = 13%; tax incentives / operating income 1,000 / 13,326.6 = 7.5%. Employees outside UCAN 16,000 - 10,900 = 5,100. Capex / revenue 688.2 / 45,183.0 = 1.5%; capex growth 688.2 / 439.5 - 1 = 57%. Free cash flow = operating cash flow less capex: 10,149.3 - 688.2 = 9,461.1 (2025); 7,361.4 - 439.5 = 6,921.8 (2024); 7,274.3 - 348.6 = 6,925.7 (2023); FCF / revenue 9,461.1 / 45,183.0 = 20.9%; FCF / net income 9,461.1 / 10,981.2 = 86%; capex / FCF 348.6 / 6,925.7 = 5.0%, 439.5 / 6,921.8 = 6.4%, 688.2 / 9,461.1 = 7.3%. Buybacks / FCF 9,127.2 / 9,461.1 = 96%; buybacks 2024 + 2025 6,263.7 + 9,127.2 = 15,390.9; diluted shares 4,261 / 4,349 - 1 = -2.0%; remaining authorization 27.1 / 296.24 = 9%. Year-end P/E = market value / net income: 213.10 / 5.408 = 39.4 (2023), 381.00 / 8.712 = 43.7 (2024), 397.29 / 10.981 = 36.2 (2025), trailing 296.24 / 13.650 = 21.7. Net debt / equity end 2025 (14,462.8 - 9,033.7 - 28.7) / 26,615.5 = 0.20; interest / operating income 776.5 / 13,326.6 = 5.8%; termination fee / 2025 net income 2,800 / 10,981.2 = 25%; ROE 10,981.2 / ((26,615.5 + 24,743.6) / 2) = 43%; net income growth 10,981.2 / 8,711.6 - 1 = 26%. Pre-tax income 2025 10,981.2 + 1,741.4 = 12,722.6, one point of tax rate = 127; six points = 763. UCAN ARM 17.20 / 15.86 - 1 = 8.4%; UCAN net additions 80,128 - 74,296 = 5,832 (2023), 89,625 - 80,128 = 9,497 (2024); paid memberships growth 301,626 / 260,276 - 1 = 16%; top plan price 37 / 32 - 1 = 15.6%. Obligations: due in 12 months / revenue 11,528.0 / 45,183.0 = 25.5%; obligations / debt 25.1 / 14.3 = 1.75; off balance sheet 18.4 / 24.0 = 76% (end 2025), 19.6 / 25.1 = 78% (June 2026). Advertising: 1.5 / 45.2 = 3.3% of 2025 revenue; 3.0 / 51.2 = 5.9% of the 2026 guidance midpoint (51.0 + 51.4) / 2 = 51.2. Nielsen gap 13.8 - 8.0 = 5.8 points. Regions: 2025 shares UCAN 19,957.2 / 45,183.0 = 44.2%, EMEA 14,514.6 / 45,183.0 = 32.1%, LATAM 5,357.5 / 45,183.0 = 11.9%, APAC 5,353.7 / 45,183.0 = 11.8%; Q2 2026 UCAN 5,432 / 12,560 = 43.2%. UCAN growth 14,873.8 / 14,084.6 - 1 = 5.6% (2023), 17,359.4 / 14,873.8 - 1 = 16.7% (2024), 19,957.2 / 17,359.4 - 1 = 15.0% (2025). EMEA memberships 101,133 / 76,729 - 1 = 31.8%; APAC memberships 57,541 / 38,023 - 1 = 51.3%; APAC revenue 5,353.7 / 3,570.2 - 1 = 50%. UCAN share of 2022 streaming revenue 14,084.6 / 31,469.9 = 44.8%. Memberships 2022-2024: UCAN 89,625 / 74,296 - 1 = 20.6%, LATAM 53,327 / 41,699 - 1 = 27.9%. ARM gap UCAN less APAC 15.86 - 8.50 = 7.36 (2022), 17.20 - 7.29 = 9.91 (2024). H1 2026 revenue 24,809.7 / 51,200 = 48.5% of the guidance midpoint. Diluted shares 4,343,863 / 4,494,966 - 1 = -3.4%. Average buyback price Q2 2026 4.7bn / 52.93M shares = about $89; 2025 9,127.2 / 86.54M shares = about $105; 71.15 / 105 - 1 = -32%. Analyst target 92.93 / 71.15 - 1 = 31%. US revenue 18.5 / 13.8 - 1 = 34%. Hedging swing 124 - (-91) = 215. Revenue 2023-2025 45,183.0 / 33,723.3 - 1 = 34%; employees 16,000 / 13,000 - 1 = 23%. Q2 net income 3,401 / 3,125 - 1 = 8.8%. DVD revenue = total revenue less streaming revenue: 33,723.3 - 33,640.5 = 82.8 (2023); 31,615.6 - 31,469.9 = 145.7 (2022) - regional revenue, memberships and viewing share. — 2015-2026 · publ. September 2026 · source ↗
    Method: Arithmetic on figures reported in Netflix's Forms 10-K and 10-Q, shareholder letters, Nielsen's May 2026 Gauge and market data; operands shown in the source line.
  3. ReportedLATAM streaming revenue was $5,357.5 million in 2025, 11.9% of the total, and $1,584 million in the second quarter of 2026, the fastest-growing region that quarter.
    Netflix second-quarter 2026 shareholder letter, Form 8-K exhibit 99.1 - quarterly results, regional revenue, 2026 guidance, view hours, live programming and advertising - financial results, regional revenue and 2026 guidance. — Q2 2026 · publ. 16 July 2026 · source ↗
  4. ReportedInside the line are 53.3 million memberships at the end of 2024, paying an average of $8.24 a month in 2024, down from $8.48 in 2022.
    Netflix Form 10-K for fiscal 2024 - paid memberships and average monthly revenue per paying membership by region for 2022-2024, regional revenue for 2022, and the 2024 currency impact. — FY2024 · publ. January 2025 · source ↗
  5. ReportedInside the line are 53.3 million memberships at the end of 2024, paying an average of $8.24 a month in 2024, down from $8.48 in 2022.
    Netflix Form 10-K for fiscal 2024 - paid memberships and average monthly revenue per paying membership by region for 2022-2024, regional revenue for 2022, and the 2024 currency impact. — FY2024 · publ. January 2025 · source ↗
  6. ReportedInside the line are 53.3 million memberships at the end of 2024, paying an average of $8.24 a month in 2024, down from $8.48 in 2022.
    Netflix Form 10-K for fiscal 2024 - paid memberships and average monthly revenue per paying membership by region for 2022-2024, regional revenue for 2022, and the 2024 currency impact. — FY2024 · publ. January 2025 · source ↗
  7. ReportedRevenue rose from $4,070 million in 2022 to $4,446.5 million, $4,840 million and $5,357.5 million, much slower than local prices.
    Netflix Form 10-K for fiscal 2024 - paid memberships and average monthly revenue per paying membership by region for 2022-2024, regional revenue for 2022, and the 2024 currency impact. — FY2024 · publ. January 2025 · source ↗
  8. ReportedRevenue rose from $4,070 million in 2022 to $4,446.5 million, $4,840 million and $5,357.5 million, much slower than local prices.
    Netflix Form 10-K for fiscal 2025 - Item 7 MD&A: streaming revenue by region. — FY2025 · publ. 23 January 2026 · source ↗
  9. ReportedIn 2024 currency movements reduced Netflix's revenue by about $1,424 million, "primarily driven by the devaluation of the Argentine peso", and LATAM revenue per membership in constant currency rose 21% that year.
    Netflix Form 10-K for fiscal 2024 - paid memberships and average monthly revenue per paying membership by region for 2022-2024, regional revenue for 2022, and the 2024 currency impact. — FY2024 · publ. January 2025 · source ↗
  10. ReportedIn 2024 currency movements reduced Netflix's revenue by about $1,424 million, "primarily driven by the devaluation of the Argentine peso", and LATAM revenue per membership in constant currency rose 21% that year.
    Netflix Form 10-K for fiscal 2024 - paid memberships and average monthly revenue per paying membership by region for 2022-2024, regional revenue for 2022, and the 2024 currency impact. — FY2024 · publ. January 2025 · source ↗
  11. ReportedIn 2025 LATAM grew 11% reported and 23% at constant currency; in the second quarter of 2026, 21% reported and 16% at constant currency, a year in which currency helped rather than hurt.
    Netflix Form 10-K for fiscal 2025 - Item 7 MD&A: streaming revenue by region. — FY2025 · publ. 23 January 2026 · source ↗
  12. ReportedIn 2025 LATAM grew 11% reported and 23% at constant currency; in the second quarter of 2026, 21% reported and 16% at constant currency, a year in which currency helped rather than hurt.
    Netflix second-quarter 2026 shareholder letter, Form 8-K exhibit 99.1 - quarterly results, regional revenue, 2026 guidance, view hours, live programming and advertising - financial results, regional revenue and 2026 guidance. — Q2 2026 · publ. 16 July 2026 · source ↗
  13. ReportedProfitability is not disclosed by region.
    Netflix Form 10-K for fiscal 2025 - Item 1 business and Item 7 overview: the single segment, pricing plans, Open Connect, employees and the end of membership reporting. — FY2025 · publ. 23 January 2026 · source ↗
  14. ReportedThe region also carries a specific tax cost: Netflix recorded about $619 million for Brazilian non-income tax assessments in 2025 and paid $729 million in the first half of 2026.
    Netflix Form 10-K for fiscal 2025 - Item 1A risk factors: competition, regulation and levies, currency, labor and the Brazil tax matter. — FY2025 · publ. 23 January 2026 · source ↗
  15. ReportedThe region also carries a specific tax cost: Netflix recorded about $619 million for Brazilian non-income tax assessments in 2025 and paid $729 million in the first half of 2026.
    Netflix Form 10-Q for the quarter ended 30 June 2026 - content obligations, the termination fee, Brazil tax payments, share repurchases and the March 2026 acquisition. — Q2 2026 · publ. 17 July 2026 · source ↗
  16. ReportedLatin America is also where Netflix's smallest workforce sits: about 700 employees, 4% of the total, against 12% of revenue.
    Netflix Form 10-K for fiscal 2025 - Item 1 business and Item 7 overview: the single segment, pricing plans, Open Connect, employees and the end of membership reporting. — FY2025 · publ. 23 January 2026 · source ↗
  17. ReportedThe region's revenue per membership in constant currency rose 21% in 2024 on Argentine price increases, the fastest price growth of any region, yet the dollar figure fell.
    Netflix Form 10-K for fiscal 2024 - paid memberships and average monthly revenue per paying membership by region for 2022-2024, regional revenue for 2022, and the 2024 currency impact. — FY2024 · publ. January 2025 · source ↗
  18. ReportedFor shareholders the region's value depends as much on exchange rates as on members, which is why reported growth swung from 11% in 2025 to 21% in the second quarter of 2026.
    Netflix Form 10-K for fiscal 2025 - Item 7 MD&A: streaming revenue by region. — FY2025 · publ. 23 January 2026 · source ↗
  19. ReportedFor shareholders the region's value depends as much on exchange rates as on members, which is why reported growth swung from 11% in 2025 to 21% in the second quarter of 2026.
    Netflix second-quarter 2026 shareholder letter, Form 8-K exhibit 99.1 - quarterly results, regional revenue, 2026 guidance, view hours, live programming and advertising - financial results, regional revenue and 2026 guidance. — Q2 2026 · publ. 16 July 2026 · source ↗
  20. ReportedThe company expected about $700 million of deposits related to the Brazilian tax matter in 2026, on top of the charge already taken.
    Netflix Form 10-K for fiscal 2025 - Item 1A risk factors: competition, regulation and levies, currency, labor and the Brazil tax matter. — FY2025 · publ. 23 January 2026 · source ↗
  21. ReportedSet against LATAM's $5,357.5 million of revenue in 2025, the Brazilian cost is a reminder that the region's profits, which Netflix does not disclose, carry country risks the revenue line does not show.
    Netflix Form 10-K for fiscal 2025 - Item 7 MD&A: streaming revenue by region. — FY2025 · publ. 23 January 2026 · source ↗
Sources
Generated September 26, 2026